The Food and Drug Administration on Friday approved the most expensive drug in the world, a $2.1 million, one-time gene therapy for treatment of a rare disease that afflicts infants.
Novartis, the drug's manufacturer, announced the approval and publicly disclosed the price for the first time. Approval of the drug, which treats spinal muscular atrophy, had been expected. Previously, Novartis had only provided an estimated price range between $1.5 million and $5 million.
Novartis said Friday that it would provide rebates to insurance companies if the drug did not work, but it did not provide details of what would be considered a failure of the drug. Even with the treatment, children do not gain normal muscle function and could still require wheelchairs and other support.
A competing drug, Biogen's Spinraza, is already on the market, but Spinraza must continue to be injected into the spines of patients for their whole lives, at a price of $750,000 for the first year and $375,000 a year after that. Novartis pointed out that the high cost of its drug is still 50 percent less than the more than $4 million for 10 years of treatment of Spinraza.
"We believe by taking this responsible approach, we will help patients benefit from this transformative medical innovation and generate significant cost savings for the system over time,'' said Vas Narasimhan, CEO of Novartis.
Novartis will set up five-year payment plans for states, small insurance companies, and self-insured employers to help them cope with the high costs of the therapy.
SMA is considered an ultra rare disease, with about 30 new patients a month. It is caused by a defective gene that is supposed to allow the body to maintain neurons. Without a proper functioning gene, infants typically died or lived on respirators and other life support.
Zolgensma is the second gene therapy approved by the FDA. The first was a Spark Therapeutics eye disease treatment, Luxterna, which also uses a virus to transport healthy genes into the body.
"Patients with SMA now have another treatment option to minimize the progression of SMA and improve survival,'' said Peter Marks, director of the FDA's Center for Biologics Evaluation and Research.